I would like to understand how to determine the impact of various movements on the undiversified SCR, with some basic reasoning. Say:
1. Fall in property value over the year
2. Fall in govt bond interest rates
3. Fall in corporate bond interest rates
4. Lower new business volumes
in general, what should be kept in mind when assessing these impacts? For instance, a drop in property rates, I thought would trigger an increase in property risk capital, however it’s actually the other way I think.
Thanks!
1. Fall in property value over the year
2. Fall in govt bond interest rates
3. Fall in corporate bond interest rates
4. Lower new business volumes
in general, what should be kept in mind when assessing these impacts? For instance, a drop in property rates, I thought would trigger an increase in property risk capital, however it’s actually the other way I think.
Thanks!